You Only Get What You Order and Pay For

No Reformation When Policy Ordered is Policy Delivered

It is an old refrain: when the insured fails to read the policy he or she can’t complain when it does not provide the coverage needed because it provides the coverage ordered. Litigation results when the insured’s failure costs him or her money.

In Bethany H. Olson A/K/A Bethany H. Reischel, Gunner J. Olson And Emmajean T. Olson, State Of Wisconsin Department Of Health Services And Spring Valley Health Care Services v.  Wisconsin Mutual Insurance Company, Jeffrey J. Keyes, v. Rural Mutual Insurance Company And Lon Truax, Sr., Appeal No. 2017AP1567, State Of Wisconsin In Court Of Appeals District III (October 2, 2018) Jeffrey Keyes appealed a judgment dismissing his third-party claims against Rural Mutual Insurance Company (Rural) and its agent, Lon Truax, Sr.

Keyes asserted he is entitled to coverage for the claims of Bethany, Gunner and Emmajean Olson, all of whom were injured by Keyes’s operation of a personal automobile on a public road. Keyes seeks coverage under a farm umbrella endorsement attached to a farmowners policy he obtained from Rural through Truax. However, the endorsement contains an exclusion that specifically precludes coverage for the off-farm use of Keyes’s personal automobiles.

On appeal, Keyes asserts the circuit court improperly dismissed his claims for reformation of the farm umbrella endorsement and for agent negligence.


The Olsons sued Keyes claiming he negligently caused their injuries resulting from an automobile collision. The accident occurred near the intersection of County Roads B and N in St. Croix County, and it involved Keyes’s use of his GMC Sierra pickup truck, which he was using to tow a gooseneck trailer containing cattle.

At the time of the accident, Keyes’s personal automobiles were covered by an automobile policy issued by Wisconsin Mutual Insurance Company. Keyes also had a farmowners policy in effect with Rural that included liability and property coverage related to Keyes’s family farm in Knapp, Wisconsin. Further, Keyes had purchased $1 million in farm umbrella liability coverage, which was attached to the farmowners policy. However, umbrella coverage for the off-farm use of personal automobiles was specifically excluded by form F-782.

Rural denied Keyes’s claim because of the exclusion and the fact that the accident occurred off of Keyes’s farm.

Keyes sued Rural and Truax seeking coverage under the farm umbrella endorsement. Keyes sought reformation of the umbrella, alleging that at the time he purchased the policy in January 2013, Truax, as Rural’s agent, had assured him that “there would be coverage for the kind of claim” the Olsons asserted. Keyes sought to have the endorsement reformed to delete the exclusion and for a declaration that the Olsons’ claims were covered by the umbrella endorsement. Keyes also asserted an insurance agent negligence claim if the umbrella was not susceptible to reformation.

The circuit court granted Rural and Truax’s motion for summary judgment and dismissed Keyes’s third-party claims.


The court interprets insurance policies with the goal of ascertaining and giving effect to the parties’ intentions. To that end it interprets policy language according to its plain and ordinary meaning as understood by a reasonable person in the position of the insured.

The exclusion plainly eliminates umbrella coverage for losses arising out of the circumstances present — that is, the operation of a personal automobile while away from the farm premises. The exclusion is unambiguous. The court must apply unambiguous policy language as written.

Reformation Of The Umbrella Endorsement

Reformation is an equitable remedy that exists to effectuate the parties’ intentions at the time they entered into a contract. A mutual mistake made by the parties to the instrument which would defeat such intentions should be corrected in equity for the purpose of putting in effect such an intention. An insurance policy may be reformed because of mutual mistake when the policy does not contain the provisions intended by the parties to be included. But, the contract must be reformed to conform to some oral agreement or understanding which the written document was intended to express.

Importantly, the mutual mistake must have existed at the time the policy was issued, and the proponent of reformation must provide clear and convincing evidence demonstrating that agreement or understanding. Such evidence typically consists of communications or conversations between the insured and the agent that contain a request or understanding regarding the scope of desired coverage.

Keyes testified  that he ordered full coverage and that to him, “full coverage” meant that he “would be covered for anything, and – and full coverage in my words would relate back to the lapses – excuse me – not lapses, but the insufficient coverage that we had with Wisconsin Mutual.” Keyes stated that, to the best of his knowledge, he had told Truax he wanted to be covered for “anything and everything”; in other words, he told Truax he wanted an umbrella policy that would cover him for “any loss” that could foreseeably occur. When asked whether he had any specific discussion with Truax about the umbrella policy covering Keyes’s use of his automobiles off of the farm premises, Keyes responded, “No.”

After Rural issued the farmowners policy and umbrella endorsement, Keyes could not recall ever speaking again with Truax about the policy. Keyes could not remember whether he had read the policy or whether he had reviewed the policy with Truax. Keyes acknowledged that neither the application he had signed nor the farmowners policy that was eventually issued identified automobile coverage in its summary of coverages on the declarations page. “Indeed, Keyes agreed that he received the exact coverage that had been listed in his signed application.” (emphasis added)

The evidence, even considered in the light most favorable to Keyes, shows that his coverage request was a general one—he variously stated he wanted to be covered for “anything and everything,” he wanted “full coverage,” and coverage for “any loss.” When asked whether he specifically requested umbrella coverage for off-farm use of his automobiles, Keyes responded that he had not. “Generic requests for coverage are insufficient to trigger an obligation on the agent’s part to procure a specific type of insurance or coverage for a specific risk.”

Reformation is not a vehicle by which an insurer may be bound to cover a risk that it did not contemplate and for which it received no premium. In all, Keyes did not established a genuine issue of material fact regarding an agreement or understanding that Keyes’s off-farm use of his personal automobiles would be covered by the umbrella endorsement. To the contrary, the undisputed evidence, including Keyes’s own testimony, shows that he never specifically requested such coverage and that he received the exact coverage for which he applied.

The facts do not permit a reasonable factfinder to conclude a “mutual mistake” occurred between Truax and Keyes regarding such coverage at the time the Rural umbrella endorsement was issued, as the law requires. Accordingly, the circuit court correctly concluded Rural was entitled to summary judgment on Keyes’s reformation claim.

Here, there could be no duty on Truax’s part to procure the umbrella coverage Keyes now seeks because, by his own admission, he did not request such coverage. Based on the foregoing, no reasonable factfinder could conclude Truax had breached the relevant standard of care. Keyes admitted he received the coverage for which he applied, despite his vague request for “full coverage.”


No insurance policy provides coverage for every eventuality. If Keyes asked for such coverage the agent would have explained the impossibility of providing such coverage. He provided the coverage Keyes ordered and there was no problem with the coverage until the accident happened and he found the umbrella did not apply. An agent who is not a fiduciary, as was Truax, is only obligated to provide the insurance ordered not what a later fact situation informs the insured he only got what he ordered not what he needed.

© 2018 – Barry Zalma

This article, and all of the blog posts on this site, digest and summarize cases published by courts of the various states and the United States.  The court decisions have been modified from the actual language of the court decisions, were condensed for ease of reading, and convey the opinions of the author regarding each case.

Barry Zalma, Esq., CFE, now limits his practice to service as an insurance consultant  specializing in insurance coverage, insurance claims handling, insurance bad faith and insurance fraud almost equally for insurers and policyholders. He also serves as an arbitrator or mediator for insurance related disputes. He practiced law in California for more than 44 years as an insurance coverage and claims handling lawyer and more than 50 years in the insurance business. He is available at and

Mr. Zalma is the first recipient of the first annual Claims Magazine/ACE Legend Award.

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About Barry Zalma

An insurance coverage and claims handling author, consultant and expert witness with more than 48 years of practical and court room experience.
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